Consumer Preference for sustainable

practices in hospitality industries

Under the guidance Dr. Sunil Giri

Authors: Bineet Seal, Sayan Majhi, Niladri Sekhar Dutta, Anagh Munshi

Abstract
The hotel industry plays a significant role in the global economy and has a significant impact on
the environment. Sustainability is the driving force for development for any industry and has become
necessary for long-term growth. This study aims to understand and identify The perception of Indian
consumers about sustainable practices in the hospitality industry, Identifying the willingness to pay
(WTP) of Indian consumers for sustainable hotel industries, understand the bridge between customer
behavior and sustainable practices by hospitality organizations, and Identifying best practices and
challenges in sustainability in the hotel industry, as well as provide recommendations for future
sustainability efforts. The core of the study lies in customers’ preference in striving to be eco-friendly
while maintaining their comfort and financially viable. Further, we have studied the organization’s
implementation of sustainable practices has helped businesses to perform better while satisfying all
three Ps: planet, people, and profit.

Keywords: Indian consumers, Sustainable practices, Hospitality industry, Consumer preference, and
perception

Introduction
Among the service sector, the Indian tourism and hospitality industry has emerged as one of the
important drivers of development. It is a sunrise industry, an employment generator, a source of
foreign exchange for the country, and an economic activity that helps nations to grow. Tourism in
India is a potential game changer. India has excelled in its beauty, uniqueness, rich culture & heritage.
India’s wide history has been vigorously promoting tourism both internationally as well as in the
domestic market. India is a tourism product and has a significant potential to become the most
wanted and preferred tourist destination globally.

The Hospitality sector is the most important part of the tourism industry which contributes to the
sector by offering services and facilities of an extremely high standard. The hotel industry in India is
expected to reach a value of INR 1,210.87 Bn by the end of 2023, expanding at a compound annual
growth rate (CAGR) of ~13% during the 2018-2023 period, owing to the high arrival rate of foreign
tourists and business delegates. With the fast degradation of the environment, hotels are taking
various initiatives to save the environment. One of the major strategies adopted by the hotel industry
is to use eco-friendly products and services. With this growing concern for the environment, the hotel
industry is making sustainable efforts to attract customers. The concept of sustainable hotels includes
broader categories like the equipment, or the infrastructure of the hotels should be sustainable, the
hotel’s policies and procedures should be linked with the environmental policies and the management
of hotels should also include all kinds of information towards sustainable policies of the hotels.
Sustainable hotels are environmentally sustainable properties whose managers are eager to institute
programs that save water, save energy, and reduce solid waste while saving money to help protect
our one and only earth.
 By implementing sustainable development practices, the hospitality industry can contribute to a
more sustainable future and help to mitigate the negative impacts of tourism, such as overcrowding
and environmental degradation. Overall, sustainable development in the hospitality industry can help
to create a more resilient, equitable, and sustainable world. Consumers prefer sustainable hotels
because they are concerned about the impact of their actions on the environment and seek to support
businesses that share their values. Sustainable hotels often use environmentally-friendly practices
such as energy-efficient lighting and appliances, recycling programs, and water conservation efforts,
which reduce their carbon footprint and help to protect natural resources. Additionally, these hotels
often provide guests with information about their sustainability practices, giving them the opportunity
to learn more about environmental issues and take an active role in supporting environmentally
responsible businesses.

Research Gap
A research gap in the area of consumer preference for sustainability in the hospitality industry
could be the limited understanding of how cultural and demographic factors, such as age, gender,
education, and income, impact consumer attitudes and behaviors toward sustainable practices in the
industry. Additionally, there may be a lack of research on the role that technology, such as mobile
apps and online reviews, plays in shaping consumer preferences for sustainability in the hospitality
industry.

Another gap could be the limited understanding of how consumers perceive and respond to the
trade-off between the cost and the benefits of sustainable practices in the hospitality industry. How
they weigh the importance of sustainability against other factors such as quality, price, and
convenience.

Filling these research gaps could provide valuable insights for hospitality businesses in their
efforts to enhance their sustainability initiatives and meet the evolving needs and expectations of
consumers.

Objective
To comprehend the present economic aspect, environmental aspect and sociocultural aspects
influencing sustainable tourism. The research aims to provide insights for hospitality businesses to
enhance their sustainability efforts and meet the evolving needs and expectations of consumers.

Literature Review
Serial No. Author Year Title Result
1 Vivek Verma and 2016 Hotel guest’s perception and It was seen that “the perception of
Bibhas Chandra choice dynamics for green Indian consumers towards hotels
hotel attribute: a mixed pertaining to inconvenience such as
method approach high cost and lost in luxury have a
significant impact on their
willingness to pay for the green
practices, as only 29.8 % guests were
willing to pay for the green practices
incorporated by the hotels
2 Neeti Kasliwal and 2015 A Study on Indian Consumers' The results found that most of the
Srishti Agarwal Attitude and Choice of consumers were aware of the term

3 Anupam and
Shikha Sharma
Preferences for Green
Attributes of the Hotel
Industry
2019 Impact of Sustainable
practices at Indian Hotels in
Northern India on Consumer
Behaviour
“green”. Green attributes like
training employees, using sensors to
save electricity; establishing
recycling programs, and saving light
bulbs were perceived as very
important attributes for the
consumers.
The aspect of willingness to pay
extra for services in a hotel
implementing green practices and
the intention to visit was analysed,
wherein it was found that elements
like environmental concern, moral
reflectiveness, overall image
perception of the service provider,
and conscientiousness
significantly affected the people’s
willingness.

Research Methodology
Based on studies commenced in the past as well as our thoughtful consideration of the subject, a
structured online questionnaire was developed as a google form for gathering data from the
respondents. Data were collected from 150 Indians conveniently located all over India.

Demographic Details

From a sample of approximately 150 respondents, 77 (51.33%) of respondents are males, and 73
(48.66%) are females. The 34.66% of sample population is student and has an age group less than 25
and has maximum of service sector respondents comprising 34.66% of the total sample lies in the age
group 25 to 30 whereas around 30.66% of sample is within the age group of 31 to 40 which gives a
good mix of age group.
 GENDER OCCUPATION Age
46,
31%
46 52
72,
73 77 48%

Student
52
Male 32, Business
21% Less than 25 25 to 30 31 to 40
Service

Findings
How much Indian consumers perceive the importance of sustainable practices in Hospitality Industry,
where 5 to 1 means very important to no importance.

0 10 20 30 40 50 60

Consumer awareness for sustainable practices in hotel industry

1 is least awared to 5 is very awared

60

49
50

39
40
34

30

20
14 14

10

0
1 2 3 4 5
Consumer perception of the sustainable efforts in the hotel industry, where 5
means most efforts to 1 means least efforts.

Total
50
45
40
35
30
25
20
15
10
5
0
1 2 3 4 5

Hypothesis Test
Hypothesis 1:

H0 (Null Hypothesis): Consumer demographics (like age and gender) have no relationship with consumer
awareness of sustainable practices in the hospitality industry.

HA (Alternate Hypothesis): Consumer demographics (like age and gender) have a relationship with
consumer awareness of sustainable practices in the hospitality industry.

Observed Very Aware Moderately aware Least aware Total

Male Age group
25 to 30 11 7 3 21
31 to 40 10 7 5 22
Less than 25 13 11 10 34
Total 34 25 18 77
Female Age group
25 to 30 11 8 4 23
31 to 40 12 6 0 18
Less than 25 17 10 5 32
Total 40 24 9 73

Expected Very Aware Moderately aware Least aware Total

Male Age group
25 to 30 9.272727273 6.818181818 4.909090909 21
31 to 40 9.714285714 7.142857143 5.142857143 22
Less than 25 15.01298701 11.03896104 7.948051948 34
Total 34 25 18 77
Female Age group
25 to 30 12.60273973 7.561643836 2.835616438 23
31 to 40 9.863013699 5.917808219 4.207792208 18
Less than 25 17.53424658 10.52054795 7.480519481 32
Total 40 24 9 73
 Chi Square Test
Gender Value df
Pearson Chi
Male Square 0.757075 4
Significance 0.05
N of valid cases 77
Pearson Chi
Female Square 0.18166 4
Significance 0.05
N of valid cases 73

At 0.05 or 5% significance level it is evident using chi-square at p-value greater than 0.05, we must reject
the null hypothesis i.e. There is a relationship between consumer awareness and consumer demographics
for sustainable practices in the hospitality industry. Males and females of all age groups are not equally
likely to be aware of sustainable hotel practices.

Hypothesis 2:

H0 (Null Hypothesis): Consumer perception of the importance of sustainable practices in the hospitality
industry has no relationship with choosing hotels to stay.

HA (Alternate Hypothesis): Consumer perception of the importance of sustainable practices in the

hospitality industry has a relationship with choosing hotels to stay

Consumer perception of the importance of sustainable practices in the Hospitality

industry
Correlation Test Very important Moderately Important Least important
Very important 1
Moderately Important 0.944911183 1
Least important 0.817057169 0.960768923 1

The correlation test suggests that there is a strong relationship between consumer perception of the
importance of sustainable practices in hotels and making choices of hotels to stay in. Where less than 0.25
means a weak direct relationship, 0.25 to 0.75 means moderately related to each other and more than 0.75
means a strong direct relationship. Hence, the null hypothesis is rejected and the alternate hypothesis is
approved.

Recommendations
The results of the study suggest that the hotel industry has made progress in adopting sustainable
practices, but there is still much work to be done. The high costs of implementing sustainable initiatives
and the lack of knowledge and resources available to support sustainability efforts are major challenges
that must be addressed in order for the industry to become more sustainable. The study recommends that
the hotel industry work together with governments and other stakeholders to provide education and
resources for sustainability efforts and to support the development of sustainable technologies.

As consumers give importance to sustainable practices in the hospitality industry, it is highly recommended
that to implement the following recommendations:
1. Energy efficiency: Implement energy-saving measures such as LED lighting, efficient heating and
cooling systems, and smart building management systems to reduce energy consumption.

2. Water conservation: Install low-flow toilets, showerheads, and faucets to reduce water usage.
Implement rainwater harvesting and greywater reuse systems.

3. Waste management: Implement a comprehensive recycling program and composting for food waste.
Minimize single-use plastic products and switch to biodegradable or compostable alternatives.

4. Green procurement: Purchase eco-friendly products, such as linens and cleaning supplies made from
sustainable materials, and locally sourced food for restaurants.

5. Building design: Consider green building practices such as natural ventilation, daylighting, and
insulation to reduce the environmental impact of construction.

6. Employee education: Educate employees on the importance of sustainable practices and encourage
their involvement in the implementation and management of sustainable initiatives.

7. Partner with sustainability-focused organizations: Partner with local organizations and initiatives to
promote sustainable tourism and contribute to the local community's environmental and economic
well-being.

Conclusion
The current study concludes that the increasing importance of consumers has led to a favourable
perception but they are not willing to pay for sustainable products and services in the hotel industry.
Customer demographics have a relationship with their behavior in choosing sustainable hotels. Indian
customers believe that the hospitality industry is making efforts for sustainable practices.

Scope for Future Research

There are several areas where further research on consumer preferences for sustainability in the
hospitality industry can be conducted, including:

• Understanding the impact of cultural differences on consumer preferences and behaviors related
to sustainability in hospitality.
• Examining the role of different marketing and communication channels in shaping consumer
attitudes towards sustainable practices in the industry.
• Investigating the relationship between consumers' sustainability preferences and their willingness
to pay for eco-friendly services and products in the hospitality sector.
• Evaluating the impact of government policies and regulations on consumer preferences for
sustainability in the industry.
• Understanding how technology, such as online platforms and mobile apps, can be leveraged to
enhance the sustainability of the hospitality industry and appeal to consumers.
• Examining the role of employee behavior and attitudes towards sustainability in shaping consumer
preferences and behavior.
• Assessing the influence of sustainability certifications and labeling systems on consumer
preferences and decision-making.
• Analysing the impact of COVID-19 pandemic on consumer preferences and behaviors related to
sustainability in the hospitality industry